Monday, April 21, 2014

American companies are stalling our economy….why?

American companies are deliberately stalling the economy.

There really isn’t any other way to interpret the fact that American companies are holding more than $1.6 TRILLION in cash – and that’s not counting the banks and other firms in the financial industry, the total cash hoard is more than $2 TRILLION.

That’s an historic high—it’s a mountain of money the companies just aren’t putting to any good use.

Companies like Apple, Google, and Microsoft, as well as large and small firms in all industries, are building up more and more cash reserves, says Moody’s Investors Service, and they’re deliberately not investing it in productive ways or returning the money to stockholders.

You know how low current market interest rates are. Think about the interest you’re earning on your checking/savings account, or in your mutual fund money market accounts, or in short-term CDs or Treasury bills. These companies aren’t doing any better with their cash and their short-term cash equivalents.

They’re just sitting on the money, deliberately not using it, instead of spending the cash to stoke their growth and the growth of our regional and national economies.

Are they waiting for the end of President Obama’s second term?

What are they waiting for?

1 comment:

  1. Is that money being held over seas and can't be bought back w/o huge tax consequences that the Conservatives want to fix but the liberals refuse to do or is it that the companies are worried about the cost of Obamacare or just plane scared of Obama's reckless conduct both to the economy and to the rule of law.